The Foundation for The Social Contract Revisited ... · PDF fileThe Social Contract Revisited Individual Responsibility and Welfare Contractualism A Relational Evaluation Peter Vincent-Jones

The Social Contract Revisited

Individual Responsibilityand Welfare ContractualismA Relational Evaluation

Peter Vincent-Jones

The Foundation for Law, Justice and Society

in affiliation with

The Centre for Socio-Legal Studies,

University of Oxford

www.fljs.org

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INDIVIDUAL RESPONSIBILITY AND WELFARE CONTRACTUALISM . 1

Executive Summary

The contractual assumption of responsibility is

dependent on institutional and social preconditions

of fairness, reciprocity, and equality that can only

be secured collectively.

� The prevailing economic recession is leading to

widening social inequalities and increasing the

potential for unfairness in the formation and

implementation of welfare contracts. Structural

unemployment and constraints on public finance

are limiting the capacity of the state effectively

to assist citizens in acquiring skills and finding

work, and undermining the relational foundations

of this governance mechanism.

� If the state cannot guarantee fairness and

reciprocity in Jobseeker’s Agreements, together

with minimum levels of social inclusion and

equality, the pretence of ‘contract’ in current

welfare policy should be abandoned. This leaves

open the wider question of whether citizens

should be provided benefits as of right or

subject to conditions imposed by the state.

� Behaviour management contracts between state

agencies and citizens are neither essentially

illiberal, nor necessarily incompatible with

individual autonomy. Whether citizens engage

meaningfully in ‘really contractual’ relationships

from which they benefit, and how far they may

be regarded as contractually responsible, are

questions for empirical investigation informed

by relational contract theory.

� Jobseekers Agreements are just one

type of behaviour management contract.

Other contemporary examples include home-

school agreements, youth offender contracts,

and parenting contracts. Each of these forms

of contractual governance is deserving of

relational evaluation on its own merits.

� The idea that individuals are capable of

undertaking responsibility for their own

welfare on a contractual basis is consistent

with the proposition that the state also

should be responsible for the welfare of citizens.


2 . INDIVIDUAL RESPONSIBILITY AND WELFARE CONTRACTUALISM

While individual contracts had been used to structure

relationships between professionals and clients

in the field of social work from the early 1980s,

the contract mechanism was first deployed as an

instrument of behaviour modification in the welfare

context by the UK government under the Jobseekers

Act 1995. This legislation made the payment of the

jobseeker’s allowance conditional upon specific

contractual undertakings entered into by welfare

recipients in a signed Jobseeker’s Agreement (JA). The

change in terminology from ‘unemployment benefit’ to

‘jobseeker’s allowance’ in the new scheme clearly

indicated the shift from a system of entitlement based

on a record of contributions, to one of conditional

payments dependent on claimants being ‘available

for employment’ and ‘actively seeking employment’.

The Labour government elected in 1997 built on

this foundation with the ‘New Deal’, a package of

programmes directed at giving unemployed people

help and support in acquiring work skills and finding

jobs. In its current incarnation (separate schemes

apply to young people, those over twenty-five

and fifty, lone parents, disabled people, partners,

and musicians) a ‘personal adviser’ is required to

draw up an action plan tailored to the experiences,

interests, and goals of the client, helping overcome

any difficulties that might be interfering with

jobseeking (such as transport or literacy problems),

and identifying any extra support needed. If a job

has not been secured by the end of a four-month

period, the adviser is responsible for arranging a

package of full-time help to meet the customer’s

specific needs. This may involve work experience

with an employer or voluntary organization, training

for a specific job, enrolling on courses to develop

the skills that employers want, practical help with

applying for jobs, and interview practice.

While the JA is not enforceable in the courts,

the symbolism of contract pervades the new

relationship between Jobcentre Plus and the

claimant. The agreement is required to be in writing

and signed by both parties, and a copy provided to

the claimant. Regulations specify the matters to be

contained in the document, including the claimant’s

name, the type of work sought, the steps to be

taken in looking for work and improving chances

of finding work, and the help to be provided by

Jobcentre Plus. The process for variation of the

terms of the agreement closely follows that for its

creation, involving similar formalities. The purpose

of the variation provisions is to ensure that the

agreement can be adapted flexibly to changes in

the labour market or the claimant’s circumstances.

Behaviour modification contracts andthe social contractJAs are just one example of the burgeoning use of

contract as an instrument of social control. Following the

election of New Labour in 1997, this function was

extended beyond the field of welfare under the School

Standards and Framework Act 1998 (home-school

agreements), the Youth Justice and Criminal Evidence

Act 1999 (youth offender contracts), and the Anti-Social

Behaviour Act 2003 (parenting contracts). In Britain as

in other social democracies, programmes directed at

behaviour modification have been accompanied by the

representation of the state–citizen relationship in ‘New

Contractualist’ discourse. Both Conservative and Labour

governments have made extensive use of social contract

rhetoric in promoting a particular vision of social order

and of the proper role of individuals in society.

Social contract rhetoric has provided the general

ideological backdrop and justification for major

changes to the organization of public services since

Individual Responsibility and WelfareContractualismA Relational Evaluation



relationship. A better starting point for understanding

what government is trying to achieve by making

welfare payments conditional on agreement is the

alternative definition of ‘contract’ as a form of

institutionally guided behaviour that serves to reduce

complexity in social exchange. In this conception,

a relationship is ‘contractual’ to the extent that it

is structured according to a mutually agreed plan

consisting of reciprocal and specific commitments

concerning future action. Contract is distinguished

from other means of promoting certainty in

social interaction based on authority relations or

hierarchical direction by this key feature, which

requires the support of core norms of consent

and choice in the planning process.

However, the effectiveness of contract as a

governance mechanism is crucially dependent on a

further set of ‘relational’ norms.2 For example, it is

necessary that the relationship between the parties

be guided by the norm of flexibility in order to avoid

excessive rigidity in the implementation of planning,

and to deal with contingencies that could not have

been foreseen at the time of agreement. The norm

of reciprocity, which implies that the exchange is

of mutual benefit, is of vital importance at the

beginning of the exchange and throughout its

duration. Further relational norms of power and

proportionality are necessary to control relations of

domination and subordination, and to ensure that the

parties deal with unexpected eventualities in a manner

that preserves cooperation in the relationship.

Compared with an externally imposed regulatory

framework, the advantage of the contract

mechanism (where appropriately supported

by relational norms) lies in its capacity for self-

regulation. Contract provides a basis for the

maximization of joint welfare by enabling the

parties to produce for themselves a constitution

which may be used in the adjustment of their

1979. The traditional welfare state grounded in

universal social rights has been radically challenged,

with the notion of entitlements being replaced

by one of negotiated claims and reciprocal duties.

New Labour’s plans for reform of the ‘unaffordable’

welfare system by the ‘Third Way’ (‘promoting

opportunity instead of dependence’) were

deliberately couched in terms of ‘A New Contract

for Welfare’ in policy proposals in 1998. In the

‘something for something’ society, the duty of the

state to ensure that citizens have a stake in society’s

future is balanced by the acceptance of responsibility

of individuals for their own improvement.

Skeptics of such discourse argue that welfare

contractualism is inherently conducive to a moralistic,

populist, and censorious political discourse which can

quite readily overwhelm any potential advantages

that may rationally be argued to accompany it.1

In this view the attempt to make welfare payments

dependent on claimants’ contractual commitments

is fundamentally misguided and lacking in legitimacy.

Agnostics counter that welfare contracts are not

essentially illiberal and repressive, but may in

principle be compatible with increased individual

freedom and autonomy. In arbitrating between these

competing claims the key question is whether, and if

so in what circumstances, claimants may legitimately

be regarded as undertaking responsibilities for their

own welfare on a contractual basis. The extent to

which claimants are able to engage meaningfully in

genuinely contractual relationships from which they

benefit is a matter for empirical investigation,

informed by relational contract theory.

Relational contract theory Like other behaviour modification contracts, the JA is

not legally enforceable. The lawyer’s definition of

contract is therefore of little assistance in analyzing

this mode of governance of the state–citizen

1. Freedland, M., and King, D. (2003) ‘Contractual Governance

and Illiberal Contracts: Some Problems of Contractualism as an

Instrument of Behaviour Management by Agencies of Government’,

Cambridge Journal of Economics, 27: 465.

2. Macneil, I. R. (1983) ‘Values in Contract: Internal and External’,

Northwestern University Law Review, 78: 340.



ongoing relations.3 While the parties’ interests

diverge, the exchange is capable of benefiting

both. Of course, such welfare-enhancing or joint-

maximizing conditions are much more problematic

and difficult to attain through contractual regimes

of behaviour modification imposed by the state

than in private relations. To the extent that contract

norms are absent or only weakly represented in

JAs, it cannot be expected that obligations will be

discharged or the contract performed to mutual

benefit, or that the programme will succeed in

achieving the government’s wider goals of

changing jobseeking behaviour.

Jobseekers Agreement: relationaldeficiencies A first problem with JAs concerns the process

whereby ‘agreement’ is secured, and the implications

for the quality of the relationship in terms of the

norms of consent, choice, and power. In reality there

is unlikely to be much scope at the planning stage

for bargaining over what the jobseeker must do in

order to demonstrate ‘actively seeking employment.’

Beneath the rhetoric of contract, the ‘agreement’

may involve the obtaining of the claimant’s

signature under duress.4

Second is the problem of reciprocity, at both

the planning stage and in the implementation of

the contract. JAs might be viewed as potentially

advantageous to claimants in this respect.

The Jobcentre’s side of the bargain might

include responsibilities for skills development,

the provision of training opportunities, and other

help in overcoming obstacles to employability.

While individualization in theory implies the tailoring

of services to the particular needs of clients by a

designated single-point case coordinator or service

broker, in practice it is doubtful how far the New

3. Campbell, D. and Harris, D. (1993) ‘Flexibility in Long-Term

Contractual Relationships: The Role of Cooperation’ Journal of Law

and Society, 20: 166.

4. Fulbrook, J. (1995) ‘The Job Seekers’ Act 1995: Consolidation with

a Sting of Contractual Compliance’ Industrial Law Journal, 24: 395.

5. Carney, T. and Ramia, G. (2002) From Rights to Management:

Contract, New Public Management and Employment Services.

The Hague: Kluwer Law International.

Deal has delivered on this promise. Even in times of

full employment, empirical evidence suggests that

genuine options are not always offered, and the

quality of training is often poor or nonexistent.

Choice is both limited and restricted. The agreement

with the jobseeker tends not to reflect client

preferences, and is seldom aimed at improving

substantive skills or addressing major barriers

to employability.5

The most popular option of full-time education

and training is not available in many areas, and

claimants may be compelled, or feel impelled, to

accept unpopular alternatives such as placements in

the voluntary sector or with the environmental task

force. Claimants enrolled on New Deal programmes

are frequently scornful of their individual action

plans. JAs tend to be mechanically drawn up, forcing

the unemployed into meaningless activities involving

‘make-work’ or broom-pushing. Employment service

workers are similarly frustrated in many cases by the

absence of suitable job opportunities, the significant

personal barriers to employability faced by claimants,

and by lack of time and resources to perform their

tasks properly. Welfare departments are typically

understaffed and under-resourced, making it difficult

for workers to take any genuine interest in clients’

own long-term goals and perceptions.

A third set of problems concerns the potential

for unfairness. Even if it is conceded that JAs are

consensual and reciprocal, and that they are capable

of benefiting clients, there is a lack of adequate

safeguards preventing abuse in particular cases

— for example through the illegitimate or

disproportionate use of sanctions. An adjudication

officer may terminate the JA where the claimant is

judged to have failed to comply with a condition or

a subsequent direction, resulting in loss of benefit.

While there exists a procedure for informal review

and more formal appeals, claimants may simply be



unaware of their contractual ‘entitlements’, or

be fatalistic or otherwise unwilling to pursue their

‘rights’ as to quasi-judicial redress. The excessive

use of sanctions may serve to reinforce social

exclusion. UK government statistics reveal particularly

high rates of use of New Deal sanctions in areas

of chronic job shortage such as the North-East,

indicating that those suffering most from the

vagaries of the market economy are also those

who are the most penalized.

Regardless of how the JA is agreed, and with what

degree of respect for the contract norms, it may be

argued that the institutional environment is one of

compulsion and the principal policy objective that of

labour market discipline. As to unfairness in a wider

sense, there is evidence that the implementation of

the JA regime in Britain has had a disproportionate

impact on disadvantaged groups, particularly ethnic

minorities. Despite claims of improvements in the

system of matching jobseekers with job opportunities

made by supporters of workfare programmes, it

appears that the most vulnerable are often

excluded from such benefits.

Conditions of legitimacy of welfarecontractualism In order for welfare contractualism to serve as a

legitimate mode of governance of relationships

between the state and citizens, various conditions

would have to be satisfied. Agreements should be

(and must be seen to be) the result of genuine

negotiation and a process of bargaining. The making,

monitoring, and enforcement of contracts should be

governed by procedures designed to ensure fairness

and mutual respect. There should be a real possibility

of sanctions proportionate to breaches on both

sides, but also safeguards against their inappropriate

or excessive use. Public agencies should undertake

reciprocal contractual commitments, and be given

sufficient resources to perform their side of the

bargain. An appropriate dispute resolution

machinery should be available and particularly

attuned to protecting the contractual interests

of the weaker party.

A more fundamental set of preconditions of

legitimacy of welfare contractualism concerns the

need for a minimum level of economic and social

equality, in particular as regards employment

opportunities and the provision by the state of

education and training programmes appropriate

to prevailing economic circumstances. A genuine

commitment to ‘fair reciprocity’ in this sense implies

a duty on the part of the state actively to reduce

barriers to inequality and social exclusion.

That such conditions are both possible and

achievable in practice may be illustrated by the

experience of other countries. For example,

Denmark has a relatively liberal welfare and

employment policy, embracing contractual

techniques that appear to involve greater respect

for the relational contract norms. The Danish

workfare model is based on ‘needs-orientated’

action plans agreed and signed by the employment

exchange and the individual claimant. Despite

similarities with the JA in Britain, there are significant

differences. The Danish provisions are articulated

within more traditional welfare state values,

with less emphasis on the responsibilities of the

individual. Negotiated work plans are more likely

to be the product of genuine consensus, and to

be less punitive and disciplinary in their operation.

In contrast with the UK (and also the US), in

Denmark the attainment of economic goals of low

unemployment and low inflation in the 1990s was

not at the expense of a reduction of real wages

and social benefits, and not founded on a new

underclass of working poor.6 On this account,

despite obligations on the unemployed to engage

actively in the labour market, and some reduction

in unemployment benefits, the maintenance of

relatively generous social assistance is associated

with low levels of social marginalization and

polarization. The commitment to upgrading

skills and qualifications is a key component

of the government’s strategy for enhancing the

6. Torfing, J. (1999) ‘Workfare With Welfare: Recent Reforms of the

Danish Welfare State’, Journal of European Social Policy, 9: 5.



rehabilitation contracts are triggered by breach of

the criminal law or conviction involving a custodial

sentence. Parenting contracts may be used in the

attempt to control young persons suspected of

involvement in criminal or anti-social behaviour.

JAs and home-school agreements are not

predicated on breach of the law or suspicion of

legal wrongdoing, but rather apply to whole classes

of citizens (respectively welfare claimants and

parents of school children). These differences have

significant implications for the way in which the

notion of ‘personal responsibility’ is conceived.

While the similarities are compelling, each form

of behaviour management contract is deserving

of consideration and relational evaluation on its

own merits.

The proposition that responsibility for the welfare

of citizens should rest with the state is not

incompatible with the argument that individuals

might, in certain circumstances, be regarded as

capable of undertaking some degree of responsibility

for their own welfare on a contractual basis.

The question of whether conditions in welfare

contracts are (or can be) genuinely contractual is

separate from that of whether welfare rights should

be absolute or conditional. This distinction tends to

be blurred in contemporary dominant critiques, which

elide normative consideration of the proper scope

and content of the social contract on the one hand

with the analysis of particular forms of welfare

contract on the other hand. If the adaptation of

contract as a means of behavioural regulation is

not ruled in principle unacceptable, relational

contract theory may help to specify the preconditions

of legitimacy and effectiveness of this instance of

the new public contracting.7

In theory, the self-regulatory mechanism of contract

provides an inherently reflexive mode of governance.

There is a significant difference between an obligation

voluntarily undertaken and one imposed by command

competitiveness of a small open economy, and the

evidence appears to indicate a relatively high level

of motivation of the unemployed through

programmes of training and education.

However, leaving aside the issue of whether the

Danish model could ever be applied in the very

different political and economic circumstances

obtaining in Britain, the current financial crisis

and economic recession pose major questions

regarding the ability of the state to guarantee the

necessary conditions of legitimacy and effectiveness

of contractual governance in the welfare context.

Constraints on public spending and the return of

mass unemployment are increasing the potential

for unfairness in the formation and implementation

of particular welfare contracts, and undermining

reciprocity by limiting the capacity of the state

effectively to assist citizens in acquiring skills and

finding work.

Inequalities are likely to become more acute as

the economic recession deepens towards the end

of the decade. A growing problem with workfare

programmes in the current climate is cream-

skimming, whereby the ‘best’ clients (those

already closest to the labour market) are selected

for the ‘best’ opportunities, leaving the less

socially desirable options for those most in need.

Meanwhile socially disadvantaged or marginalized

citizens are likely to be signatories to a number of

behaviour management contracts in the fields of

education and criminal justice as well as welfare,

for example as young people subject to referral

orders, tenants on poor housing estates subject

to acceptable behaviour contracts, or parents of

children suspected of anti-social behaviour either

at school or in the community. The combined

effect of these arrangements in many cases will

be to discipline and sanction those who are already

vulnerable and socially excluded for noncompliance.

Conclusion While all behavioural contracts perform social control

functions, they vary considerably in their nature and

policy objectives. Youth offender contracts and7. Vincent-Jones, P. (2006) The New Public Contracting: Regulation,

Responsiveness, Relationality. Oxford: Oxford University Press.


INDIVIDUAL RESPONSIBILITY AND WELFARE CONTRACTUALISMS . 7

of the state, the former being more likely to be

of mutual benefit and to be effective in changing

behaviour. There is also a difference in the way

in which the consequences of norm violation

can be presented, with the sanction following

breach of an agreed undertaking being easier

to justify both to the party who has broken the

obligation and to society as a whole. Furthermore,

welfare contractualism may be used to focus attention

on the state’s own reciprocal obligations, and

on whether it is delivering its side of the bargain.

This opens up new possibilities for increased public

accountability. On the government’s own analysis,

the current ‘third age of welfare’ is supposed to

entail responsibility on the part of governments for

providing help to individuals in discharging their

individual and social responsibilities.7

In practice, however, the empirical evidence has

revealed significant relational deficiencies in the

implementation of welfare contractualist policy in

Britain, even during a period of full employment.

Problems include the unequal power relationship

between the state and individual citizens; the

probable lack of negotiation and consensus in the

determination of agreements; the lack of reciprocity

in the state’s undertakings and ability to deliver

on them; and the general absence of substantive

individual rights and procedural safeguards in respect

of contractual processes. Structural unemployment

coupled with widening economic and social

inequalities is exacerbating such problems.

If the state cannot guarantee fairness and reciprocity

in welfare contracts, founded on minimum levels of

social inclusion and equality, conditionality cannot

have a genuinely contractual basis. In that case the

pretence of contract in government policy should be

abandoned, leaving open the more fundamental

question of whether citizens should be provided

welfare benefits as of right, or subject to conditions

imposed by the state.

8. Department of Social Security (1998) A New Contract for Welfare:

New Ambitions for Our Country, Green Paper, Cm 3805.




The FoundationThe mission of the Foundation is to study, reflect

on, and promote an understanding of the role that

law plays in society. This is achieved by identifying

and analysing issues of contemporary interest and

importance. In doing so, it draws on the work of

scholars and researchers, and aims to make its work

easily accessible to practitioners and professionals,

whether in government, business, or the law.

The Social Contract RevisitedThe aim of the Foundation's programme, The Social

Contract Revisited, is to establish the theoretical

and institutional underpinnings that characterize

the reciprocal rights and obligations amongst citizens

and between the citizens and the state in modern

liberal society. Through publication of the findings

of such study, the Foundation will enrich both the

theoretical and the policy debate concerning some

of the most fundamental issues facing modern

Western societies.

Peter Vincent-Jones is Professor of Law at the

University of Leeds. He is an expert on contractual

governance and an author of a highly acclaimed

book The New Public Contracting (Oxford University

Press, 2006). His main interests are the overlapping

areas of contract and public law, regulation and

socio-legal theory. He has published widely on

privatization and contractualization of public services

in the UK and Europe. He is currently engaged in a

five-year research project – "Reflexive Governance in

the Public Interest" – comparing different modes of

healthcare regulation in Britain, France, and Hungary.


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The Foundation for The Social Contract Revisited ... · PDF fileThe Social Contract Revisited Individual Responsibility and Welfare Contractualism A Relational Evaluation Peter Vincent-Jones